Dealing with nasty EU customs

June 10, 2009 12:43 IST

When cargo is unloaded from an Etihad Airways plane at Frankfurt airport a few weeks ago, customs officials show unusual interest in a consignment of medicines from India.

The medicine is in transit to Denmark, although the final destination is the Republic of Vanuatu which, in case you are curious, is a Y-shaped archipelago of 83 volcanic islands in the South Pacific Ocean. It is among the less developed countries and for the islands' small population the shipment of medicines would have gone a long way.

The medicine in transit is amoxicillin, an antibiotic commonly used to treat a wide range of bacterial infections, and it has been manufactured in Chennai. The consignment consists of a little over three million capsules valued at euro 28,000 (Rs 18.2 lakh).

The German customs, suspecting trademark violation - or so they say - seize the medicines and detain it till they check with GlaxoSmithKline Pharmaceuticals, who they believe owns the trademark.

All this takes a fortnight and more, and the cargo which was seized on May 5 is finally released a couple of days after GSK certifies on May 20 that there is no trademark violation.

Indeed, there could not have been a violation since amoxicillin is an international non-proprietary name or generic name. The drug giant did at one time hold the patent for Amoxil, the brand name of amoxicillin but that was long time ago.

The German customs officials clearly did not know this; intellectual property rights are not their forte. Yet, customs officials in the EU and the developed world (OECD countries) are increasingly being forced to enforce IPR through a variety of regulations that contravene internationally agreed regulations on IPR, which is World Trade Organisation's TRIPS agreement.

The more pernicious of these measures is EC Regulation 1383 that allows customs officials and rights holders to interfere in the legitimate trade of generic medicines.

The Frankfurt outrage came to light because of a campaign mounted by a handful of voluntary agencies, led by Health Action International, an independent, global network that is trying to improve access to essential medicines.

The first of the seizures was made towards the end of 2008 when the Dutch customs began detaining Indian generics at Amsterdam airport. Although India and Brazil, one of the countries importing generics from this country, issued strong statements at the General Council of the WTO condemning the Dutch action, it did not stop the seizures which are increasingly plaguing generics exports from India.

HAI has discovered that there have been 17 seizures of generics - all but one originating from India - by the Netherlands.

What is patently clear is that the EU will continue to enforce the border measures under its controversial Regulation 1383 however apoplectic India and its developing country allies might get. In fact, the European Commission has coolly ignored India's requests to provide information on drug seizures in the EU.

Officials at India's Permanent Mission to WTO in Geneva are now using the limited information provided by the Dutch authorities to HAI which used the Freedom of Information Act to get details of the seizures to make a case.

Last week, Sunjay Sudhir, counsellor at the mission, condemned the clever tactics being employed by the EU to confuse legitimate generics, which offer a lifeline to the poor across the world, with counterfeit drugs - and worse.

The grounds mentioned by the EC for the drug seizures include counterfeits, fake drugs, substandard, potentially dangerous products, patent violations and, believe it or not, drug trafficking! An incensed Sudhir told the TRIPS Council that India took serious exception to such unsubstantiated and wild allegations - as proved by the subsequent release of the medicines.

Officials acknowledge that the EU actions are clearly intended to create barriers to legitimate trade of generic drugs and to subvert the Doha Declaration on Public Health. "We are talking about generic medicines, which neither infringe IPRs nor are 'potentially dangerous'. It seems that it has been ingrained very deeply within the EC authorities that such products are synonymous with potentially dangerous substances. This clearly is an untenable logic," the Indian official told the council.

It's a nice speech that Sudhir made, well argued and full of righteous anger. Some months back Commerce Secretary G K Pillai, too, had spewed brimstone and fire, at the Dutch and the EU, calling the seizures an act of piracy.

But that was it. There was no follow-up at the WTO and the seizures continue while India's pharma industry frets and makes its periodic and ineffectual appeals to the government. Health activists get into a lather each time there is news of a shipment being detained and there is much hair-splitting on the legal niceties of the TRIPS provisions.

It's a familiar pattern. So do we wait for the next seizure to repeat the drill?